Why should Private Equity bother with leasing now?
Simple:
Because it enables additional, longer-term, and more cost-effective financing flexibility!
Portfolio companies face numerous challenges in covering increased liquidity needs and continuing to grow enterprise value during longer holding periods (#ValueCreation).
Leasing offers a straightforward and quickly implementable solution:
The compelling advantages are:
🔹 Leasing increases liquidity that can be used for working capital, add-ons, or distributions!
🔹 Lower financing costs: Leasing is more cost-effective than term loans and working capital/capex facilities!
🔹 Tax benefits: Leasing unlocks tax advantages (e.g., interest barrier rules), making it even more significantly cost-efficient!
🔹 Improved balance sheet metrics: When structured correctly, leasing enhances KPIs (e.g., leverage ratio and equity ratio)!
🔹 Diversification of funding sources: You tap into a new market that can recognize the intrinsic value of assets and apply a risk-mitigating approach!
🔹 Survives the exit: Leasing provides longer-term financing (beyond the exit), thereby reducing the buyer's financing requirements!
Let's talk!
#LeasingPilot
#LeasingCanDoMore #LBO #CFO #Treasury #PrivateEquity
Why Should Private Equity Bother with Leasing Now?
